CMA publishes study on evaluating compensation opportunities for affected parties

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The Capital Market Authority (CMA) published a study on the "Assessment of Compensation Opportunities for Affected Parties in the Capital Market," which examines the increasing frequency of compensations arising from announcements of punitive decisions against violators of the Capital Market Law, its implementing regulations, and other regulations enforced by the CMA in recent years.

Ali Sulaiman Aldakheel, General Director of Communication & Investor Protection Division at CMA, affirmed that the study reflects the CMA’s commitment to its role in protecting investors and continuing to provide support, as well as informing them of their rights and responsibilities to ensure an attractive and secure investment environment. The study focused on analyzing complaints and feedback received by CMA to assess the current situation, gathering and examining all responses for in-depth analysis.
 
Additionally, input was sought from specialists and law firms with experience in similar cases before the Committee for Resolution of Securities Disputes to identify any gaps, whether in compensation methods or in the mechanism for handling complaints and securities disputes.

Aldakheel explained that the CMA thoroughly analyzed all findings from the study, identifying areas for necessary development and taking measures to facilitate compensation avenues for affected parties in the capital market in a systematic and organized manner. He asserted that this study aligns with CMA's significant commitment to protecting the rights of investors and market participants, as reflected in the CMA's 2024–2026 strategic plan. The plan's third pillar, "Protecting Rights of Investors", includes objectives and initiatives, among which are protective initiatives aimed at streamlining compensation pathways. developing procedures for class action suits to facilitate access to private rights, and reducing the time from detecting violations to compensating affected parties. He noted that the CMA aims to monitor and measure the degree to which individual investors are empowered to recover their rights and the success rate of legitimate compensation claims before the Committee for Resolution of Securities Disputes.

The General Director of the Communication & Investor Protection Division emphasized that the Authority places the utmost importance on protecting the rights of investors and market participants, especially in ensuring a secure investment environment, facilitating compensation processes, and developing effective mechanisms to protect investors from unfair or improper practices, as well as practices involving fraud, deceit, or manipulation.​